Crown prince: Saudi Arabia ready to extend oil production cut deal

Saudi Arabia’s Crown Prince Mohammed bin Salman on Saturday said that the Kingdom of Saudi Arabia is ready to support the extension of an oil production cut agreement reached last year between OPEC and some Non-Opec nations in order to balance global crude oil supply and demand.

“The Kingdom affirms its readiness to extend the production cut agreement, which proved its feasibility by rebalancing supply and demand,” the Crown Prince said in a statement.

Crown Prince Mohammed bin Salman also said that “the high demand for oil has absorbed the increase in shale oil production.”

“The journey towards restoring balance to markets, led by the Kingdom, is proving successful despite the challenges,” he added.

The Crown Prince said during the October 24-26 Future Investment Initiative (FII) conference in Riyadh that demand for oil will increase in the future, which restored trust to petroleum markets. The Crown Prince said that the future of energy, both conventional and renewable, will be promising, and that the Kingdom will lead both sectors.

OPEC holds its ministerial meeting in the Austrian capital Vienna at the end of next month. OPEC and some non-OPEC countries including Russia have vowed to lower their output by a total of about 1.8 million barrels per day to the end of March 2018 to help curb a glut in global petroleum supplies.

Offshore Energy Today has previously reported that Vladimir Putin, president of Russia, the biggest producer of the Non-Opec block that’s part of the deal, would not rule out the possible a possible further extension of the agreement between OPEC and Non-Opec nations to cut oil production once the deal expires in March 2018.

In a speech earlier in October, during the Russian Energy Week event, Putin said that the deal Russia, other countries, and OPEC members reached in 2016 not only stabilized oil prices, but has also enabled opportunities to “implement promising projects for technological cooperation, because investments have returned to this sector of the world economy.”

Putin said: “What we did together with OPEC, I think, is beneficial to the entire world economy. Whether we will extend these agreements or not, will depend on how the situation in the world market will develop. In principle, I do not rule it out, but we will proceed from those realities that will develop in March 2018.”

He also said:”When we decide whether to extend or not, then we will define the terms. But in general, if we talk about a possible extension, then, of course, at least until the end of 2018.”

According to Reuters, Brent crude futures were at $60.55 per barrel Monday morning, near the highest level since July 2015.